Most Staphylococcus aureus infections are endogenously acquired, and treatment of nasal carriage is one potential strategy for prevention. We critically appraised the published evidence regarding the efficacy of intranasal mupirocin for eradication of S. aureus nasal carriage and for prophylaxis of infection. Sixteen randomized, controlled trials were appraised; 9 trials assessed eradication of colonization as a primary outcome measure, and 7 assessed the reduction in the rate of infection. Mupirocin was generally highly effective for eradication of nasal carriage in the short term. Prophylactic treatment of patients with intranasal mupirocin in large trials did not lead to a significant reduction in the overall rate of infections. However, subgroup analyses and several small studies revealed lower rates of S. aureus infection among selected populations of patients with nasal carriage treated with mupirocin. Although mupirocin is effective at reducing nasal carriage, routine use of topical intranasal mupirocin for infection prophylaxis is not supported by the currently available evidence.